Revenue from Payments In Lieu Of Taxes (PILOT) is projected to reach almost $1.4 million in this year’s municipal budget while foreclosure registry fees are expected to jump by more than 50 percent.
City Council introduced the 2019 budget in May, which is expected to bring a $49 increase in the municipal portion of the tax bill for the average assessed home ($133,000). The $56-million spending plan is expected to come up for a public hearing and final adoption during the governing body’s combined pre-conference and regular meeting scheduled tonight at 7 p.m.
UPDATED: A copy of the complete 66-page municipal budget, obtained through an Open Public Records Act (OPRA) request, can be accessed here.
Revenue from PILOTs is projected to total $1.391 million in this year’s budget from eight recent and not-so-recent develelopments:
- Lower Essex Street / Denholtz Management (Rahway Plaza Apartments), $490,000
- Senior Citizen Housing, $280,000
- Meridia Water’s Edge (10-year PILOT), $180,000
- Meridia Lafayette Village, (15-year) $180,000
- Metro Rahway (15-year), $155,000
- Housing Authority, $60,000
- Meyers Senior Residence, $21,000
- Rosegate, $25,000
Last year, PILOT revenue totaled $1.5 million but the decline is more about the transition from the Parking Authority to a Parking Utility within the city. Previously, the Parking Authority and the city split a $340,000 PILOT for the 136-unit River Place building on Lewis Street. The Parking Utility is now part of the municipal budget (Sheet 36/Page 52 of 66), with $480,000 anticipated from a ground lease for that project. Last year’s municipal budget anticipated $170,000 from the River Place project but realized $155,833. This year’s budget recognizes the $170,000 as “Municipal Services – Parking Authority.”
Revenue from the city’s vacant/foreclosure registry is anticipated to jump to $630,000. Actual revenue from the foreclosure registry in the 2018 budget was $630,915, almost 50 percent more than the $410,000 originally budgeted in the spending plan adopted a year ago.
In 2017, $350,000 was anticipated in the budget but the city recorded actual revenue of $606,815, or about 73 percent more than anticipated. Revenue from the foreclosure registry has increased every year since it was enacted:
- 2018 — $630,915
- 2017 – $606,815
- 2016 – $403,500
- 2015 – $322,500
In an effort to reduced foreclosures and encourage owners to take action on their properties, City Council established a foreclosure registry in August 2014. Owners, typically banks who held foreclosed mortgages, were required to register properties within 14 days of becoming vacant.
The initial registration fee was $500, which would increase to $1,500 after the first year, and $3,000 for the second renewal. The cost of a third renewal — and any subsequent renewals — would be $5,000. Thus, the longer a property has been on the foreclosure list, the higher registration fee it would pay. Anecdotally at least, it’s clear there have been some foreclosed properties either razed or renovated over the last few years. Foreclosed properties still remain on the registry from its inception would now be hitting the third year or later — meaning they’d be paying the $5,000 renewal fee.
